If you’ve been in Vancouver for a few years you may remember the last time the market took a dip was in 2008.
As prices fell we started to see more and more stories about buyers trying to get out of presales contracts and developers going after buyers for the difference between their deposit and the current market value of the condo.
Well looks like we’re starting to see legal wrangling over presales contracts again, the most recent one is buyers trying to get out of their purchase agreements at the Hotel Georgia.
Falling Vancouver real-estate prices and widespread expectations that they’ll fall further have sparked a rise in lawsuits from condo buyers who want to get out of their presale contracts.
The trend underscores the importance for developers to scrupulously follow the Real Estate Development Marketing Act (REDMA) – because failure to do so can render sales contracts unenforceable and enable buyers to get their deposits back.
“People wouldn’t be looking for the return of their deposits if the units were worth more than or as much as they purchased them for,” Harper Grey LLP partner Bryan Baynham told Business in Vancouver.
The most recent string of lawsuits involves Georgia Properties Partnership’s (GPP) Residences at Hotel Georgia project, which is set to be complete in December – one year later than the developer promised buyers.
Baynham had filed six lawsuits from buyers of units at the Residences at Hotel Georgia as of October 24. He expects to file more.
The project has 156 units. As of September, 96 were sold.
If prices continue to fall in Vancouver you can bet we’ll see more legal action over presales contracts, both from buyers and developers.
The telephone company is building a condo tower and they’ve sold out their pre-sales units.
“It’s all geographic who’s doing well.”
Recent figures from the Real Estate Board of Greater Vancouver compiled by various real-estate analysts indicate higher numbers for unsold inventory than past years at the same time.
Local sellers all say that it’s not foreign investors driving the market for the successful projects, but local investors and people planning to live in the condos themselves.
Ms. Goertz said Telus offered its employees priority in sales at Telus Gardens and 150 of them bought, even though the price discount was a modest one per cent.
BLISTINGAGENT had an interesting point in the previous thread: A couple of years ago when the market took a dive a lot of presales buyers tried to walk away from their contracts and developers sued them for the difference between their deposit and the current value of the condos. What happens if the market takes another dive and Telus employees try to walk away from their presales? Dock their pay?
Hey! A opening day presales condo in Vancouver SOLD OUT!
Marine Gateway, and the 415 pre-sale units that sold, is big news because at a time when listings are soaring and sales have been falling off a cliff, the pre-sales at this development have bucked the negative trend.
In fact it has completely turned that trend on it’s head.
Let’s put that into perspective.
A sell-out of pre-sale condo unit offerings hasn’t happened in Vancouver in over six years. As Global TV noted in this story, you have to go back to the Woodward’s presale in 2006 – before the collapse of the world financial markets – to match an opening day pre-sale sellout of a condo development.
Either the market is on the upswing again or Rennie is back with his marketing magic… Although he does seem to have lost the ‘be bold or move to the suburbs’ thing.
Check out Whispers from the Edge of the Rainforest for an examination of this sell-out.